3 charged in $1.2M Amazon fraud scheme

A box bearing Amazon's smile logo moves along a conveyor belt on Nov. 30, 2015, at Amazon.com's fulfillment center in DuPont, Wash. (AP Photo/Ted S. Warren)

INDIANAPOLIS (WISH) — Three central Indiana residents have been charged with attempts to defraud an online retailer of $1.2 million in consumer electronics including GoPro digital cameras, Microsoft Xboxes, Samsung smartwatches and Microsoft Surface tablets, federal authorities said Friday.

Erin and Leah Finan, both 37, a husband and wife from the Muncie-Anderson area, pleaded guilty to federal mail fraud and money laundering charges, according to a news release issued Friday by the U.S. attorney’s office in Indianapolis. Danijel Glumac, 28, of Indianapolis, was charged in a grand jury indictment with interstate transportation of stolen property and money laundering.

The Finans falsely claimed that the electronics they ordered were damaged or not working, and then requesting and receiving replacements from Amazon at no charge, the release said.

“Amazon’s customer service policy allows, under certain circumstances, customers to receive a replacement before they return a broken item. Amazon closely monitors customers’ accounts and orders for possible fraudulent activity. The Finans allegedly went to great lengths to conceal their fraud, creating hundreds of false online identities to perpetrate the scheme. Eventually, however, Amazon and federal law enforcement caught up with them,” the release said.

The charges show Glumac fenced the Finans’ stolen goods to an entity in New York, the release said.

“The Finans allegedly sold the stolen electronics out of their van to Glumac at a price substantially below their retail value. Glumac then marked them up and sold and shipped them to the New York entity, which in turn sold them to the public. Glumac also allegedly advised the Finans on how to evade detection by Amazon,” the release said.

Investigators with the Internal Revenue Service, the U.S. Postal Inspection Service and the Indiana State Police also found Glumac laundered the proceeds from his sales of the stolen electronics through bank accounts associated with his clothing business before paying the Finans their cut.

“In total, Glumac allegedly received over $1.2 million from the New York entity, of which he paid approximately $725,000 to the Finans,” the release said.

Assistant U.S. Attorney Nick Linder, who is prosecuting the case for the government, said that the charges carry maximum sentences of between 10 and 20 years in prison and fines of between $250,000 and $500,000.

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